ATENEOCENTRALBAROPERATIONS2007

Civil Law
SUMMER REVIEWER
ves
)
to
con
CHA
(General
trib
PTE
Profession
ute
R 1:
al
mo
GEN
Partnership
ney
ERA
,
,
L
Art.17672)
pro
PRO
Two or
pert
VISI
more
y,
ONS
persons may
or
also form a
ind
partnership
ustr
PART
for the
y to
N
exercise of a
a
E
profession.
co
R
mm
S
ELEMENTS
on
HI
OF A
fun
PPARTNERS
d,
a
HIP:
with
co
There shall
the
ntr
be a
inte
ac
partnership
ntio
t
whenever:
n of
wh
1. Ther
divi
er
e is
din
ei
a
g
n
mee
the
tw
ting
pro
o
of
fits
or
the
am
m
min
ong
or
ds;
the
e
2. To
ms
form
pe
elv
a
rs
es.
com
on
(se
mon
s
e
fund
bi
Art
;
nd
.
3. With
th
17
inte
e
67,
ntio
m
CC
n
sel

that
pro
fits
(an
d
loss
es)
will
be
divi
ded
am
ong
the
cont
racti
ng
part
ies.
ESSENTIA
L
FEATURES
:
1. The
re
mus
t be
a
VA
LID
CO
NT
RA
CT.
2. T
h
e
p
a
rt
ie
s
m
u
st
h
a
v
e

3.

L
E
G
A
L
C
A
P
A
CI
T
Y
to
en
ter
int
o
th
e
co
ntr
ac
t.
T
h
e
r
e
m
u
s
t
b
e
a
m
u
t
u
a
l
c
o
n
t
ri
b
u
ti
o

n
o
f
m
o
n
e
y
,
p
r
o
p
e
r
t
y
,
o
r
i
n
d
u
s
t
r
y
t
o
a
C
O
M
M
O
N

4.

FUN
D.
Ther
e
mus
t be

5.

a
LA
WF
UL
OB
JE
CT.
T
h
e
p
u
r
p
o
s
e
o
r
p
r
i
m
a
r
y
p
u
r
p
o
s
e
m
u
s
t
b
e
t
o
o

b
t
a
i
n

s
.

2 It

also
requir
ed
that
the
article
s
of
partne
rship
must
NOT
be
kept
SECR
ET
amon
g the
memb
ers;
other
wise,
the
associ
ation
shall
have
no
legal
perso
nality
and
shall
be
gover
ned
by the

P
R
O
F
I
T
S
a
n
d
D
I
V
I
D
E
t
h
e
s
a
m
e
a
m
o
n
g
t
h
e
p
a
r
t
i
e

is

provisions
on
COOWNERSH
IP
(Art.
1775).

"kept
secre
t
amon
g the
mem
bers"

on
al
lia
bili
ty
of
pa
rtn
er
s
for
pa
rtn
er
CHARACTERISTICS:
shi
1.
Essentially
p
contractual
de
innat
ure (Art.
1767,
bts
are needed to
see this picture.
FORM
178
OF
4)
PART
2. Sep
NERS
arat
HIP
e
CONT
jurid
RACT
ical
=
secre
cy
direct
ed
not to
third
perso
ns
but to
some
of the
partn
ers

TIFF

(Uncompressed)
decompressor

3.

4.

5.

per GENERAL
son
RULE:
ality
No
(Art
special
.
form is
176
require
8)
d for
Del
the
ectu
validity
s
of a
per
contra
son
ct.
ae
(Art.
Mut
1356)
ual
Age
ncy
(Art
.
180
3)
P
er
s

CHAPTE
R 2:
OBLIGA
TIONS
OF
PARTNE
RS

Art. 1784. A
partner
ship
begins
from
the
momen
t of the
executi
on
of
the
contrac
t,
unless
it
is
otherwi
se
stipulat
ed.
EXCEPTIO
NS:
1. Wh
ere
imm
ova
ble
pro
pert
y/re
al
righ
ts
are
con
trib
ute
d

(Art
.
177
1)
1. P
u
b
l
i
c
i
n
s
t
r
u
m
e
n
t
i
s
n
e
c
e
s
s
a
r
y

2.

I
n
v
e
n
t
o
r
y
o
f
t
h

e
p
r
o
p
e
r
t
y
c
o
n
t
ri
b
u
t
e
d
m
u
s
t
b
e
m
a
d
e
,
s
i
g
n
e
d
b
y
t
h
e
p
a
r
ti
e
s
a
n
d

a
t
t
a
c
h
e
d
t
o
t
h
e
p
u
b
l
i
c
i
n
s
t
r
u
m
e
n
t
o
t
h
e
r
w
i
s
e
i
t
i
s
V
O

I
D

2. Wh

3.

en
the
con
trac
t
fall
s
und
er
the
cov
era
ge
of
the
Stat
ute
of
Fra
uds
(Art
2.
.
140
9)
Wh
ere
cap
ital
is
P3,
000
or
mor
e,
in
mo
ney
or
pro
pert
y
(Art
.
177
2) NOTE:
1. P

u
b
li
c
i
n
s
t
r
u
m
e
n
t
i
s
n
e
c
e
s
s
a
r
y
M
u
s
t
b
e
r
e
g
i
s
t
e
r
e
d
w
it
h
S
E
C

SEC
Opi
nio
n, 1
Jun
e
196
0:
For
purp
ose
s of
conv
enie
nce
in
deal
ing
with
gov
ern
men
t
offic
es
and
fina
ncial
instit
utio
ns,
regi
strat
ion
of
part
ners
hip
havi
ng a
capi
tal
of
less
than
Php
3,00
0 is
reco
mm
end
ed.

SEPA
RATE
JURI
DICA
L
PERS
ONA
LITY
Art.

crim
inal
acti
ons,
in conformity
with the laws
and
regulations
of their
organization
. (See Art.
46)

with the
require
ments
of
Article
1772,
first
paragra
ph.

1768.
The
As a
partner JURIDICAL
ship
PERSON, a
has a partnership
juridica may:
l
1. acqu
person
ire
ality
and
separat
poss
e and
ess
distinct
prop
form
erty
that of
of all
each of
kinds
the
;
partner
2. incur
s, even
oblig
in case
ation
of
s;
and
failure
3. bring
to
civil
comply
or

; He
Advise ads:
r: Dean Joy
Cynthia Marie
Roxas- Ponsar
Del
an,
Castillo Eleano

PRINCI
PLE OF
DELEC
TUS
PERSO
NARUM
DELECTU
S
PERS
ONAE
The
selectio
n or
choice
of the
person.
Implication
s: (Dean
Villanueva)

r
Tajan, John Paul
Mateo; Lim; Subje c t He ad:
Unde Thea Marie
rstudie Jimenez; Ple dg e e
s: Joy s: Naealla Rose
Steph Bainto, Sandra May
anie Maclang

nt of a
partner of
his share
does not
make
assignee
a partner
(Art.

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

1 The

assignme

1804
1813)

and

The
existence

of
the
partnershi
p
is
closely
tied-up to
the
particular
contractu
al
relationsh
ip of the
partners
(see
instances
of
dissolutio
n of the
partnersh
ip upon
change of
contractu
al
relationsh
ip.)

Ortega v. CA,
G.R. No. 109248,
July 3, 1995
Doctrine of
Delectus
Personae:
The birth and
life
of
a
partnership at will
is predicated on
the mutual desire
and consent of
the partners. The
right to choose
with
whom a
person wishes to
associate himself
is
the
very
foundation
and
essence of that
partnership.

(According to Dean Villanueva)

In the absence of contractual stipulation, all
partners shall be considered agents and
whatever any one of them may do alone shall
bind the partnership (Art. 1803[1], 1818)
Partners can dispose of partnership property
even
when
in
partnership
name
(Art. 1819)

An admission
or
representation
made by any
partner
concerning
partnership
affairs
is
evidence
against
partnership
1820)

the
(Art.

Notice to any
partner of any
matter relating
to
partnership
affairs is notice
to the
partnership

(Art. 1821)

(Art. 1822)

Wrongful act or
omission
of
any
partner
acting
for
partnership
affairs makes
the partnership
liable
Partnership
bound to make
good losses for
acts
or
misapplications
of
partners
(Art. 1823)
UNLIMITED LIABILITY
(According to Dean Villanueva)
All partners are liable pro rata with all their
properties and after partnership assets have
been exhausted, for all partnership debts (Art.
1816)
Any stipulation against personal liability of
partners for partnership debts is void , except as
among them (Art. 1817)

QuickTime and a

TIFF (Uncompressed) decompressor

are n eded to see this picture.

All partners
are
partnership for
everything
MEANING of MUTUAL AGENCY
chargeable to

liable solidarily with the

the
partnership
when caused
by
the
wrongful act
or omission of
any
partner
acting in the
ordinary
course
of
business
of
the
partnership or
with authority
from the other
partners and
for partner's
act
or
misapplicatio
n
of
properties
(Art. 1824)

1 A

newly
admitted
partner into
an existing
partnership
is liable for
all
the
obligations
of
the
partnership
arising
before his
admission
but out
of
partnership
property
shares
(Art. 1826)
Partnership
creditors
are
preferred to
those of
each of the
partners as
regards the
partnership
property
1827)

(Art.

Upon
dissolution
of
the
partnership
,
the
partners
hall
contribute
the
amounts
necessary
to
satisfy
the
partnership
liabilities
(Art.
1839[4],
[7])
PARTN
ERSHIP
DISTIN
GUISHE
D

FROM
COOWNE
RSHIP

AND
CORPO
RATION

PARTNERS
HIP
Created by a
contract, by
mere
agreement of
the parties
Has a
juridical
personality
separate and
distinct from
that of each
partner

Creation

Juridical
personal
ity

COOWNERS
HIP
Created by
law

None

Purpose

Realization of
profits

Duration/
Term of
existenc
e

No limitation

Disposal
/
Transfer
ability of
interest

Partner may
not dispose
of his
individual
interest
unless
agreed upon
by all
partners

Co-owner
may freely
do so

Power to
act with

In absence of
stipulation to
contrary, a

Co-owner
cannot
represent

3rd

Page 158 of 297

Common
enjoyment
of a thing
or right
10 years
maximum

CORP
Created by
law

Has a
juridical
personality
separate
and distinct
from that of
each
stockholder
Depends
on AOI
50 years
maximum,
extendible
to not more
than 50
years in
any one
instance
Stockholde
r has a
right to
transfer
shares
without
prior
consent of
other
stockholder
s
Manageme
nt is vested
with the

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007
persons

Effect of
death

Dissoluti
on

# of
incorporators
Commen
cement
of
juridical
personal
ity

A
particular
partnership is
distinguished
from
joint
venture, to wit:

1) a joint
(an
partner may venture
American
bind
partnership concept similar
(each partner
to our joint
is agent of
partnership) account) is a
Death of sort of informal
partner partnership,
results in with no firm
dissolution ofname and no
partnership
legal
personality. In
joint
May be a
the
dissolved at account,
any time by participating
the will of anymerchants can
or all of the
partners transact
business
Minimum of 2under
their
persons own
name,
and can be
individually
From the
moment of liable
execution of therefore; and
contract of
partnership

2) usually, but
not necessarily
a joint venture is
QuickTime
and a

Heirs of Tan
Eng Kee v. CA,
G.R.
No.
126881,.
October 3, 2000
Particular
partnership
distinguished
from
joint
venture

limitedTIFF
to a
single
transaction,
(Ucompressed)decompressor
although
the business
are
nee
ded
to
see
this
pict
ure.

of pursuing to
a successful
termination
may continue
for a number
of years; a
partnership

generally relates
to a continuing
business
of
various
transactions of
a certain kind.

It
would
seem that under
Philippine law, a
joint venture is a
FORM
of
PARTNERSHIP
, specifically a

particular
partnership which
has for its object
specific
undertaking.

Aurbach v.
Sanitary Wares,
180 SCRA 130
(1989) The
Supreme Court
has, however,
recognized a
distinction
between these
two business
forms and has
held that although
a corporation
cannot enter into
a partnership, it
may, however,
engage in a joint
venture with
others.
WEAKNE
SSES OF
A
PARTNER
SHIP
(Dean

Villanueva)

Partners are
co-owners of
the
partnership
properties and
enjoy personal
possession
(Art.

1811)

Partners may
individually
dispose of real
property of the
partnership
even when in

partnership
name (Art. 1819)

Dissolution of
the partnership
can
come
about by the
change in the
relationship of
the
partners,
such as when a
partner
chosses
to
cease being

partnership
business can
only be
carried at a
loss; other
equitable
reasons (Art.
1831)
NOTE:

part of the
partnership (Art.
1828, 1830[1]b)
Expulsion of
partner dissolves
the partnership
(Art. 1830[1]d)

Dissolved
by
the loss of the
thing promised
to be
contributed to the
partnership (Art.
1830[4]) Death,
insolvency, or
civil interdiction
of a partner

3 dissolves the

partnership
(Art. 1830 [5],
[6],[7]) Petition
by partner will
dissolve the
partnership
when a partner
has been
declared
insane; or the
partner has
become
incapable of
performing his
part of the
partnership
contract; a
partner has
been found
guilty of such
conduct as
tends to affect
prejudicially the
partnership
business;
partner willfully
or persistently
commits a
breach of
partnership
agreement; the

SEC
Opinion,
28 April
1995: The
death of a
partner,
as
a
general
rule,
dissolves
the
partnershi
p
by
operation
of
law,
except if
the
articles of
partnershi
p stipulate
for
the
continuan
ce of the
partnershi
p relations
upon
the death of
any of the
partners.

SEC
Opinion,
5 August
1997:
If
the
remaining
partners
of
the
dissolved
partnershi
p intended
for
all
legal
intents
and
purposes,

to continue
the
partnership
business
even after
the death of
a partner,
there
is
continuity

of
personalit
y of the
partnershi
p as there
exists
a
"partnersh
ip at will."
Page 159 of 297

by Estoppel
under Article
1825

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

RULES TO
DETERMIN
E
EXISTENC
E OF
P
A
R
T
N
E
R
S
H
I
P
GENERAL
RULE:
Persons who
are
NOT
partners
as
between
themselves,
CANNOT be
partners as to
third persons.
(Art. 1769(1))
EXCEPTION:
Partnership

OTHER RULES
TO DETERMINE
WHETHER A
PARTNERSHIP
EXISTS: (See
Art. 1769)
1. Coownershi
p or copossessio
n
does
not
of
itself
establish
a
partnershi
p
2. The
sharing of
gross
returns
does not
of
itself
establish
a
partnershi
p,
whether
or not the
persons
sharing
them
have
a
joint
or
common
right
or

3.

interest in
any
property
from
which the
returns
are
derived;
The
receipt by
a person
of a share
of
the
profits of
a
business
is prima
facie
evidence
that he is
a partner
in
the
business,
UNLESS
such
were
received
in
payment:
1. A
s
d
e
bt
b
y
in
st
al
l
m
e
nt
s
or
ot
h
e
r
w

2.

3.

4.

5.

is
e;
A
s
w
a
g
e
s
or
re
nt
;
A
s
a
n
n
ui
ty
;
A
s
in
te
re
st
o
n
lo
a
n;
A
s
c
o
n
s
i
d
e
r
a
t
i
o
n
f

o
r

s
t
a
l
l
m
e
n
t
s

s
a
l
e
o
f
g
o
o
d
w
i
l
l
o
f
b
u
s
i
n
e
s
s
/
o
t
h
e
r
p
r
o
p
e
r
t
y
b
y
i
n

Art.

1770.
A
partnership
must have a
lawful object
or purpose,
and must be
established
for
the
common
benefit
or
interest
of
the partners.
When an
unlawful
partnership
is dissolved
by a judicial
decree, the
profits shall
be
confiscated
in favor of
the
State,
without
prejudice to
the
provisions
of the Penal
Code
governing
the
confiscation
of
the
instruments
and effects

of a crime.

EFFECTS
OF AN
UNLAW
FUL
PARTNE
RSHIP:
1. The
contract
is void
ab initio
and the
partner
ship
never
existed
in the
eyes of
the law.
(Art.
1409[1]
)
2. The
profits
shall be
confiscate
d in favor
of the
governme
nt. (Art.
1770)
3. The
instruments or
tools and
proceeds of the

QuickTime
and a

crime

TIFF

shall al
(Uncmpr
so
be
ssed)
forfeite
dcompressor
d
i
n favor of
the are
needed to see
this picture.

4.

governme
nt. (Art.
1770,
Art. 45RPC)
The
contributi
ons
of
the
partners

shall not
be
confiscat
ed unless
they fall
under no.
3. (See
Arts.
1411 and
1412)
NOTE: Judicial
decree is not
necessary to
dissolve an
unlawful
partnership.

EFFECT OF
PARTIAL
ILLEGALITY:

1. Where a

2.

part of
the
business
of a
partnersh
ip is legal
and a
part
illegal, an
account
of that
which is
legal may
be had.
Where,
without
the
knowled
ge or
participa
tion of
the
partners,
the
firm's
profits in
a lawful
business
have
been
increase
d by
wrongful
acts, the
innocent
partners
are not
preclude
d as
against
the guilty
partners

from
recoveri
ng their
share of
the
profits.
(De
Leon, p.
65)

W
HO
MA
Y
BE
PA
RT
NE
RS
GENERAL
RULE: Any
person
capacitated to
contract may
enter into a
contract of
partnership.
EXCEPTIONS:
1. Persons
who are
prohibite
d
from
giving
each
other any
donation
or
advantag
e cannot
enter
into
a
universal
partners
hip. (Art.
1782)
2. Persons
suffering
from civil

3.

interdicti
on.
Persons
who
cannot
give
consent
to
a
contract:
1. M
in
or
s
2. in
s
a
n
e
p
er
s
o
n
s
3. d
e
af
m
ut
e
s
w
h
o
d
o
n
ot
k
n
o
w
h
o
w
to
w
rit
e

MAY
CORPOR
ATIONS
ENTER
INTO
P
A
R
T
N
E
R
S
H
I
P
?
Philippine
Corporate
Law (2001) by
Dean
Villanueva
(p. 902) citing
various SEC
Opinions:

Corporati
ons may
enter into
partnershi
p
agreemen
ts on the
following
condition
s:
1. A
ut
h
or
it
y
to
e
nt
er
in
to
a
p
a

rt
n
er
s
hi
p
re
la
ti
o
n
is
e
x
pr
e
s
sl
y
c
o
nf
er
re
d
b
y
th
e
c
h
a
rt
er
or
th
e
a
rti
cl
e
s
of
in
c
or
p
or
at

io
n
(
A
oI
),
a
n
d
th
e
n
at
ur
e
of
th
e
b
u
si
n
e
s
s
v
e
nt
ur
e
to
b
e
u
n
d
e
rt
a
k
e
n
b
y
th
e
p
a
rt

2.

n
er
s
hi
p
is
in
li
n
e
w
it
h
th
e
b
u
si
n
e
s
s
a
ut
h
or
iz
e
d
b
y
th
e
c
h
a
rt
er
or
A
oI
.
If
it
is
a
fo
re
ig

n
c
or
p
or
at
io
n,
it
m
u
st
o
bt
ai
n
a
li
c
e
n
s
e
to
tr
a
n
s
a
ct
b
u
si
n
e
s
s
in
th
e
c
o
u
nt
ry
in
a
c
c
or

d
a
n
c
e
w
it
h
th
e
C
or
p
or
at
io
n
C
o
d
e
of
th
e
P

hi
li
p
pi
n
e
s.

WHEN
IMMOVABL
ES OR
REAL
RIGHTS
C
O
N
T
R
I
B
U
T
E
D
Page 160 of 297

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007
Art.

1773. A
contract of
partnership
is
void,
whenever
immovable
property is
contributed
thereto, if
an
inventory
of
said
property is

not made,
signed by
the
parties,
and
attached
to
the
public
instrument
.
GENERAL
RULE:
Failure to
comply with
the
requiremen
t
of
appearance
in
public
instrument
and
SEC

Registration
will
not
affect
the
liability
of
the
partnership
and
the
members
thereof
to
third
persons.
(Art. 1772
2)
EXCEPTION:
When
IMMOVABL
E
PROPERTY
/
REAL
RIGHTS are
contributed,
*public
instrume
nt +
inventory
*
made
and
signed
by
the parties
and
attached to
the
public
instrument
(Arts. 1771
and 1773) is
required for
the benefit
of
third
persons.

PROPERTY IS
CONTRIBUTED
VOID

VOID

With Public
Instrument, No
Inventory

VOID

VOID

VALID

No Public
Instrument, With
Inventory

but either party

may compel
execution of
public instrument
so it may be
registered in the
registry of
property;
nonetheless,
partnership
agreement may
be enforced (cf.
Arts. 1356 to

VOID

QuickTime and a
TIFF (Uncompressed) decompressor
are needed to see this picture.
1358)

With Public
Instrument, With
Inventory

(Source: Bar
Review Notes
for
Partnership
Law by Atty.
Villareal)
NOTE:

EFFECT OF
ABSENCE OF
REQUIREMENT
S UNDER
ARTICLES 1771
AND 1773
CONDITION OF
PARTNERSHIP
WHERE REAL

No public
Instrument, No
Inventory

Torres
v. CA,
320
SCRA
428
(1999)

VALID

VALID

immovab

Partnershi
ps

void

under
Art.1773,
in relation

le
property
contribut
ed,

in

spite

of

article

Art. 1771

1773

may

declaring

still

be

the

considere

partners

either

de

facto

or
partnershi
ps

vis--

vis

third

persons;
may even
be treated
an

ordinary
contract
from
which
rights and
obligation
s

may

validly
arise,
although
not
exactly a
partnershi
p

under

the

Civil

Code.
Failu
re

to

prepare
an
inventory
of

would
not

estoppel

as

hip void

the

render
the
partners
hip void
when:

1. N
O
T
H
I
R
D
P
A
R
T
Y
I
N
V
O
L
V
E
D
(s
in
c
e
A
rt.
1

2.

77
3
wa
s
int
en
de
d
for
the
pr
ote
cti
on
of
3r
d
pa
rti
es;
Pa
rtn
ers
ha
ve
M
AD
E
A
CL
AI
M
O
N
TH
E
PA
RT
NE
RS
HI
P
AG
RE
E
M
EN
T.

CLASSIFIC
ATIONS OF
PARTNER
SHIP
AS TO EXTENT
OF ITS SUBJECT
MATTER

1. UNIVERS
AL
PARTNE
RSHIP
1. U
N
IV
E
R
S
A
L
P
A
R
T
N
E
R
S
H
IP
O
F
A
L
L
P
R
E
S
E
N
T
P
R
O
P
E
R
T
Y

co
mp
ris
es
the
foll
ow
ing
:
1. Pr
o
p
er
ty
w
hi
c
h
b
el
o
n
g
e
d
to
e
a
c
h
of
th
e
p
ar
tn
er
s
at
th
e
ti
m
e
of
th
e
c
o

n
s
t
i
t
u
t
i
o
n
o
f
t
h
e
p
a
r
t
n
e
r
s
h
i
p

2. Pr

ofi
ts
w
hi
ch
th
ey
m
ay
ac
qu
ire
fro
m
all
pr
op
ert
y

2. U

c
o
n
tr
ib
u
t
e
d

NI
VE
RS
AL
PA
RT
NE
RS
HI
P
OF
PR
OF
IT
S co
mp
ris
es
all
tha
t
the
pa
rtn
ers
ma
y
ac
qui
re
by
the
ir
ind
ust
ry
or
wo
rk

d
ur
in
g
th
e
e
xi
st
e
n
c
e
of
th
e
p
ar
tn
er
s
hi
p
NOTE: Persons
who
are
prohibited
from
giving donations
or advantage to
each other cannot
enter
into
a
universal
partnership. (Art.
1782)
2.
PA
RTI
CU
LA
R
PA
RT
NE
RS
HIP

has
for
its
obj

ects:
1. De
ter
mi
nat
e
thi
ng
s
2. Th
eir
us
e
or
frui
ts
3. Sp
eci
fic
un
de
rta
kin
g
4. Ex
erc
ise
of
pr
ofe
ssi
on
or
vo
cat
ion

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

2. LIMITED
PART
NER

AS TO LIABILITY
OF PARTNERS
1. GENERAL
PART
NERS
HIP
consi
sts of
gener
al
partn
ers
who
are
liable
pro
rata
and
subsi
diarily
and
somet
imes
solida
rily
with
their
separ
ate
prope
rty for
partn
ership
debts.
Page 161 of 297

SHIP
one
forme
d by
2 or
more
perso
ns
havin
g as
mem
bers
one

or
more
gener
al
partn
ers
and
one
or
more
limite
d
partn
ers,
the
latter
not
being
perso
nally
liable
for
the
obliga
tions
of the
partn
ershi
p
AS TO
DURATION

1. PARTNE
RSHI
P AT
WILL
one
in
which
no
time
is
speci
fied
and is
not
forme
d for

2.

a
partic
ular
under
taking
or
ventu
re
which
may
be
termi
nated
anyti
me
by
mutu
al
agree
ment
PARTNE
RSHI
P
WITH
A
FIXE
D
TER
M
the
term
for
which
the
partn
ershi
p is to
exist
is
fixed
or
agree
d
upon
or
one
forme
d for
a
partic

ular
under
taking

ents
for
its
esta
blish
men
t

AS TO
LEGALITY OF
EXISTENCE

1. DE JURE

PAR
TNE
RSH
IP
one
whic
h
has
com
plied
with
all
the
legal
requ
irem
ents
for
its
esta
blish
men
t

2. DE

FAC
TO

one
whic
h
has
faile
d to
com
ply
with
all
the
legal
requ
irem

AS TO
PURPOSE

1. COMME

2.

RCIA
L OR
TRA
DING
PART
NER
SHIP
one
forme
d for
the
trans
action
of
busin
ess
PROFES
SION
AL
OR
NON
TRA
DING
PART
NER
SHIP
one
forme
d for
the
exerci
se of
a
profe
ssion

KINDS OF
PARTNERS:

e
liabilit
y to 3

1. CAPITA

2.

3.

LIST

one
who
contr
ibute
s
mon
ey or
prop
erty
to
the
com
mon
fund
INDUST
RIA
L
one
who
contr
ibute
s
only
his
indu
stry
or
pers
onal
servi
ce
GENERA
L
one
whos
e
liabilit
y to 3

rd

5.

QuickTime and a

or
busine
ssTIFF(Unc
ompressed)

ofthedec
ompressorp
artners
hip

6.

rd

4.

perso
ns
exten
ds to
his
separ
ate
prope
rty
LIMITED
one
whos

perso
ns is
limite
d to
his
capita
l
contri
butio
n
MANAGI
NGone
who
manages
the affairs

7.

are
need
ed to
see
this
pictur
e.

LIQUI
DATI
NG
one
who
takes
charg
e of
the
windi
ng up
of
partn
ershi
p
affair
s
upon
dissol
ution
PART
NER
S BY
ESTO
PPEL
one
who

is not
really
a
partn
er but
is
liable
as a
partn
er for
the
prote
ction
of
innoc
ent

8. CONTIN

rd

3
perso
ns

9.

UING
PART
NER
one
who
contin
ues
the
busin
ess of
a
partn
ershi
p
after
it has
been
dissol
ved
by
reaso
n of
the
admis
sion
of a
new
partn
er,
retire
ment,
death
or
expul
sion
of
one
of the
partn
ers
SURVIVI
NG
PART
NER
one
who

10.

11.

remai
ns
after
a
partn
ershi
p has
been
dissol
ved
by
death
of
any
partn
er
SUBPAR
TNE
R
one
who
is not
a
mem
ber of
the
partn
ershi
p who
contr
acts
with a
partn
er
with
refere
nce
to the
latter'
s
share
in the
partn
ershi
p
OSTENSI
BLE
one
who

12.

13.

takes
active
part
and
know
n to
the
public
as
partn
er in
the
busin
ess
SECRET
one
who
takes
active
part
in the
busin
ess
but is
not
know
n to
be a
partn
er by
outsid
e
partie
s
SILENT
one
who
does
not
take
any
active
part
in the
busin
ess
altho
ugh
he

14.

may
be
know
n to
be a
partn
er
DORMAN
T
one
who
does
not
take
active
part
in the
busin
ess
and is
not
know
n or
held
out
as a
partn
er

OBLIGATION
S OF THE
PARTNERS
TO ONE
AN
OT
HE
R

1) OBLIGATION
S OF THE
PARTNERS
AMONG
THEMSELV
ES
1.
PROMISED
CONTRIBUT

ION
Obligations
with
respect to
contributio
n of
property:
1. to
c
o
nt
ri
b
ut
e
at
th
e
b
e
gi
n
ni
n
g
of
th
e
p
a
rt
n
er
s
hi
p
or
at
th
e
st
ip
ul
at
e
d
ti
m
e
th

e
m
o
n
e
y,
pr
o
p
e
rt
y
or
in
d
u
st
ry
w
hi
c
h
h
e
m
a
y
h
a
v
e
pr
o
m
is
e
d
to
c
o
nt
ri
b
ut
e
(
A
rt
.
1

2.

7
8
6)
T
o
a
n
s
w
er
fo
r
e
vi
ct
io
n
in
c
a
s
e
th
e
p
a
rt
n
er
s
hi
p
is
d
e
pr
iv
e
d
of
th
e
d
et
er
m
in
at
e

3.

pr
o
p
e
rt
y
c
o
nt
ri
b
ut
e
d
(
A
rt
.
1
7
8
6)
T
o
a
n
s
w
er
to
th
e
p
a
rt
n
er
s
hi
p
fo
r
th
e
fr
ui
ts
of
th
e

pr
o
p
e
rt
y
th
e
c
o
nt
ri
b
ut
io
n
of
w
hi
c
h
h
e
d
el
a
y
e
d,
fr
o
m
th
e
d
at
e
th
e
y
s
h
o
ul
d
h
a
v
e
b

4.

e
e
n
c
o
nt
ri
b
ut
e
d
u
p
to
th
e
ti
m
e
of
a
ct
u
al
d
el
iv
e
ry
(
A
rt
.
1
7
8
6)
T
o
pr
e
s
e
rv
e
s
ai
d
pr
o

p
e
rt
y
w
it
h
th
e
di
li
g
e
n
c
e
of
a
g
o
o
d
fa
th
er
of
a
fa
m
il
y
p
e
n
di
n
g
d
el
iv
e
ry
to
p
a
rt
n
er
s

5.

hi
p
(
A
rt
.
1
1
6
3)
T
o
in
d
e
m
ni
fy
p
a
rt
n
er
s
hi
p
fo

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

o
f
t
h
e
s
a
m
e
o
r
b

r
a
n
y
d
a
m
a
g
e
c
a
u
s
e
d
to
it
b
y
th
e
re
te
nt
io
n
Page 162 of 297

y
th
e
d
el
a
y
in
its
c
o
nt
ri
b
ut
io
n
(
A
rt
s.

1
7
8
8
,
1
1
7
0
)
EFFECT OF
FAILURE TO
CONTRIBUTE
PROPERTY
PROMISED:
1. Partners
becomes
ipso jure
a debtor
of
the
partnersh
ip even in
the
absence
of
any
demand
(See Art.
1169[1])
2. Remedy
of
the
other
partner is
not
rescissio
n
but
specific
performa
nce with
damages
from
defaulting
partner
(Art.
1788)
Obligations
with
respect to
contributio

n of money
and money
converted
to personal
use:
1. T
o
c
o
nt
ri
b
ut
e
o
n
th
e
d
at
e
fix
e
d
th
e
a
m
o
u
nt
h
e
h
a
s
u
n
d
er
ta
k
e
n
to
c
o
nt
ri
b

2.

u
t
e
t
o
t
h
e
p
a
rt
n
e
r
s
hi
p
T
o
r
ei
m
b
u
r
s
e
a
n
y
a
m
o
u
n
t
h
e
m
a
y
h
a
v
e
t
a
k
e
n

3.

fr
o
m
th
e
p
ar
tn
er
s
hi
p
c
o
ff
er
s
a
n
d
c
o
n
v
er
te
d
to
hi
s
o
w
n
u
s
e
T
o
p
a
y
fo
r
th
e
a
gr
e
e
d

o
r
le
g
al
in
t
e
r
e
st
,
if
h
e
f
ai
ls
t
o
p
a
y
hi
s
c
o
n
tr
ib
u
ti
o
n
o
n
ti
m
e
o
r
in
c
a
s
e
h
e
t
a

4.

k
e
s
a
n
y
a
m
o
u
nt
fr
o
m
th
e
c
o
m
m
o
n
fu
n
d
a
n
d
c
o
n
v
er
ts
it
to
hi
s
o
w
n
u
s
e
T
o
in
d
e
m

ni
fy
t
h
e
p
a
rt
n
e
r
s
hi
p
f
o
r
t
h
e
d
a
m
a
g
e
s
c
a
u
s
e
d
t
o
it
b
y
d
el
a
y
in
t
h
e
c
o
n
tr

ib
ut
io
n
or
c
o
n
v
er
si
o
n
of
a
n
y
s
u
m
f
o
r
h
i
s
p
e
r
s
o
n
a
l
b
e
n
e
f
i
t
s
(
S
e

e
A
r
t
.
1
7
8
8
)
2.
FIDUCIARY
DUTY
A partnership
is a fiduciary
relationone
entered into and
to be maintained
on the basis of
trust
and
confidence. With
that, a partner
must observe the
utmost good faith,
fairness,
and
integrity in his
dealings with the
others:
1. h
e
c
a
n
n
o
t
di
r
e
ct
ly
o
r
in
di
r
e

2.

ctl
y
u
s
e
p
ar
tn
er
s
hi
p
a
ss
et
s
fo
r
hi
s
o
w
n
b
e
n
e
fit
;
h
e
c
a
n
n
ot
c
ar
ry
o
n
a
b
u
si
n
e
ss
of
th

3.

e
p
a
rt
n
e
r
s
hi
p
f
o
r
hi
s
p
ri
v
a
t
e
a
d
v
a
n
t
a
g
e
;
h
e
c
a
n
n
o
t,
in
c
o
n
d
u
ct
in
g
t
h

e
b
u
si
n
e
ss
of
th
e
p
ar
tn
er
s
hi
p,
ta
k
e
a
n
y
pr
o
fit
cl
a
n
d
e
sti
n
el
y;

4.

he
ca
nn
ot
Qui
ckTi
me

o
bt
ai
nnd

for
hi
m
se
lf
th

at
h
e
should have obtained for the

5.

partnership
opportunity)
h
e
c
a
n
n
o
t
c
a
rr
y
o
n
a
n
o
t
h
e
r
b
u
si
n
e
s
s
in
c
o
m
p
e
tit
io
n
w
it
h
t
h
e
p
a

6.

rt
n
er
s
hi
p;
h
e
c
a
n
n
ot
a
v
ail
hi
m
s
el
f
of
k
n
o
wl
e
d
g
e
or
in
fo
r
m
at
io
n
w
hi
c
h
m
a
y
b
e
pr
o

p
e
rl
y
r
e
g
a
r
d
e
d
a
s
t
h
e
p
r
o
p
e
rt
y
o
f
t
h
e
p
a
rt
n
e
r
s
hi
p
;

PROHIBITION
AGAINST
COMPETITIVE BUSINESS
INDUSTRIAL PARTNER
--cannot engage in
business (w/n same line of
business with the
partnership) unless
partnership expressly
permits him to do so.
(Art. 1789)

CONSEQUENCE
S IF AN
INDUSTRIAL
PARTNER
ENGAGES IN
ANY BUSINESS:
(Art. 1789)
1. he can be
excluded
from the
partnershi
p; or
2. the
capitalist
partners
can avail
of
the
benefit
he
obtained
from the
business
, or
3. the
capitalist
partners
have the
right to
file
an
action
for
damage
s against

ENGAGING

IN

CAPITALIST
PARTNER
--cannot engage in
business (with same
kind of business with
the partnership) for
his own account,
unless there is a
stipulation to the
contrary.
( Art. 1808)

the
industria
l
partner,
in either
case.
CONSEQUENC
ES
IF
THE
CAPITALIST
PARTNER
ENGAGES IN A
BUSINESS
(which competes
with
the
business of the
partnership):
1. he may
be
required
to bring
to
the
common
fund the
profits
he
derived
from the
other
busines
s; (Art.
1808)
2. he shall
personal
ly bear
the
losses;
(Art.
1808)
3. he may
be
ousted
form the
partners
hip,
especiall
y if there
was
a
warning.

Obligation
s with
respect to
contributio
n to
partnershi
p capital:
1. P
a
r
t
n
e
r
s
m
u
s
t
c
o
n
t
r
i
b
u
t
e
e
q
u
a
l
s
h
a
r
e
s
t
o
t
h
e
c
a

p
i
t
a
l
o
f
t
h
e

t
o

p
a
r
t
n
e
r
s
h
i
p
u
n
l
e
s
s
t
h
e
r
e
i
s
s
t
i
p
u
l
a
t
i
o
n

2.

c
o
n
t
r
a
r
y
(
A
r
t
.
1
7
9
0
)
P
a
r
t
n
e
r
s
(
c
a
p
it
a
li
s
t
)
m
u
s
t
c
o
n
t
r
i

b
u
t
e
a
d
d
i
t
i
o
n
a
l
c
a
p
i
t
a
l
I
n
c
a
s
e
o
f
i
m
m
i
n
e
n
t
l
o
s
s
t
o
t

h
e
b
u
s
i
n
e
s
s
o
f
t
h
e
p
a
r
t
n
e
r
s
h
i
p
a
n
d
t
h
e
r
e
i
s
n
o
s
ti
p
u
l
a

t
i
o
n
o
t
h
e
r
w
i
s
e
;
r
e
f
u
s
a
l
t
o
d
o
s
o
s
h
a
l
l
c
r
e
a
t
e
a
n
o
b
l

i
g
a
ti
o
n
o
n
h
i
s
p
a
r
t
t
o
s
e
ll
h
i
s
i
n
t
e
r
e
s
t
t
o
t
h
e
o
t
h
e
r
p
ar
tn

e
r
s
(
A
rt
.
1
7
9
0
)
Requisit
es:
1. T
h
e
r
e
i
s
a
n
i
m
m
i
n
e
n
t
l
o
s
s
o
f
t
h
e
b
u
s
i
n

e
s
s
o
f
t
h
e
p
a
r
t
n
e
r
s
h
i
p

2. T
h
e

m
a
j
o
r
it
y
o
f
t
h
e
c
a
p
it
a
li
s
t
p
a
r
t

n
e
r
s

u
ti
o
n

a
r
e

t
o
t
h
e

o
f
t
h
e

c
o
m
m
o
n

o
p
i
n
i
o
n

f
u
n
d

t
h
a
t
a
n
a
d
d
i
t
i
o
n
a
l
c
o
n
t
r
i
b

Civil Law
Summer

w
o
u
l
d
s
a
v
e
t
h
e

Page 163 of 297

Reviewer
ATENEO

b
u
s
i
n
e
s
s

o
n
t
r
i
b
u
t
e

CENTRALBAR
OPERATIONS

2007
3. T
h
e
c
a
p
i
t
a
l
i
s
t
p
a
r
t
n
e
r
r
e
f
u
s
e
s
d
e
l
i
b
e
r
a
t
e
l
y

(
n
o
t
d
u
e
t
o

4.

f
i
n
a
n
c
i
a
l
i
n
a
b
i
l
i
t
y
)
T
h
e
r
e

t
o

i
s

o
a
g
r
e
e
m
e
n
t
t
o
t
h
e
c
o
n
t
r
a
r
y
Obligation
of
managing
partners
who
collects
debt from
person
who also
owed the
partnershi
p
(Art.
1792)
1. A
p
p
l
y
s
u
m

c
o
l
l
e
c
t
e
d
t
o
2
c
r
e
d
i
t
s
i
n
p
r
o
p
o
r
t
i
o
n
t
o
t
h
e
i
r
a
m
o
u

n
t
s

2. I

f
h
e
r
e
c
e
i
v
e
d
i
t
f
o
r
t
h
e
a
c
c
o
u
n
t
o
f
p
a
r
t
n
e
r
s
h
i
p
,
t
h

e
w
h
o
l
e
s
u
m
s
h
a
l
l
b
e
a
p
p
l
i
e
d
t
o
p
a
r
t
n
e
r
s
h
i
p
c
r
e
d
i
t
Requisite

s:

1. T
h
e
r
e
e
x
i
s
t
s
a
t
l
e
a
s
t
2
d
e
b
t
s
,
o
n
e
w
h
e
r
e
t
h
e
c
o
l
l
e
c
t

i
n
g
p
a
r
t
n
e
r
i
s
c
r
e
d
i
t
o
r
a
n
d
t
h
e
o
t
h
e
r
,
w
h
e
r
e
t
h
e
p
a
r
t

n
e
r
s
h
i
p
i
s
t
h
e

2.

3.

c
r
e
d
i
t
o
r
B
ot
h
d
e
bt
s
ar
e
d
e
m
a
n
d
a
bl
e
T
h
e
p
a
r
t
n

e
r
w
h
o
c
o
l
l
e
c
t
s
i
s
a
u
t
h
o
r
i
z
e
d
t
o
m
a
n
a
g
e
a
n
d
a
c
t
u
a
l

l
y
m
a
n
a
g
e
s
t
h
e
p
a
r
t
n
e
r
s
h
i
p

Obligation
of partner
who
receives
share of
partnershi
p credit

1. O
b
l
i
g
e
d
t
o
b
r
i
n

g
t
o
t
h
e
p
a
r
t
n
e
r
s
h
i
p
c
a
p
i
t
a
l
w
h
a
t
h
e
h
a
s
r
e
c
e
i
v
e
d
e
v

e
n
t
h
o
u
g
h
h
e
m
a
y
h
a
v
e
g
i
v
e
n
r
e
c
e
i
p
t
f
o
r
h
i
s
s
h
a
r
e
o
n

l
y
(
A
r
t
.
1
7
9
3
)
Requisite
s:
1. A
p
a
r
t
n
e
r
h
a
s
r
e
c
e
i
v
e
d
i
n
w
h
o
l
e
o
r
i
n

p
a
r
t
,
h
i
s
s
h
a
r
e
o
f
t
h
e
p
a
r
t
n
e
r
s
h
i
p

2.

c
r
e
d
i
t
T
h
e
o
t
h
e
r
p

a
r
t
n
e
r
s
h
a
v
e
n
o
t
c
o
l
l
e
c
t
e
d
t
h
e
i
r
s
h
a
r
e
s

3. T
h
e
p
a
r
t
n
e
r
s

h
i
p
d
e
b
t
o
r
h
a
s
b
e
c
o
m
e

RULES FOR
DISTRIBUTION
OF PROFITS
AND
LOSSES (See
Art. 1797)
With
agreement
Without
agreement

i
n
s
o
l
v
e
n
t
BEARING THE
RISK OF LOSS
OF THINGS
CONTRIBUTED
(Art. 1795)

1799. A
stipulation
which
excludes
Specific and determinate one
or
which are not fungible where only
more
the use is contributed
Specific and determinate partners
the ownership of which isfrom
any
transferred to the partnership share in the
TIFF (Unco press d) decompressor
profits and
are needed to see this picture.
is
Things contributed to be sold losses
void.
Things brought and appraised in
the inventory
NOTE:
Specific and determinate
Stipulation
which are not fungible where only
exempting
a
the use is contributed
partner
from
Fungible things (consumable )

Art.

PROFITS
According to
agreement
1. Share of
capitalist
partner is in
proportion to his
capital
contribution
2. Share of
industrial
partner is not
fixed - as may
be just and
equitable under
the
circumstances

LOSSES
According to
agreement
1. If sharing of
profits is
stipulated apply to
sharing of
losses
2. If no profit
sharing
stipulated losses shall
be borne
according to
capital
contribution
3. Purely
industrial
partner not
liable for
losses

losses should be
allowed. If a
person
can
make a gift to
another, there is
no sound reason
why a person
cannot
also
agree to bear all
the losses. Of
course, as far as
THIRD
PERSONS are
concerned, any
such stipulation
may be properly
declared void.
(De Leon, pp.
124-125, citing
Espiritu and
Sibal)
RIGHTS
AND
OBLIGATIONS
WITH RESPECT
TO
MANAGEMENT

Partner is
appointed
manager in the
articles of
partnership

Partner is
appointed
manager after
constitution of

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

partnership
2 or more persons
entrusted with
management of
partnership
without
specification of
duties/stipulation
that each shall not
act w/o the other's
consent
Stipulated that
none of the
managing
partners shall act
w/o the consent of
others

Manner of
management not
agreed upon

Power of
managing
partner is
irrevocable
without
just/lawful
cause;
Revocable only
when in bad
faith
Power is
revocable any
time for any
cause

Vote of
partners
representing
controlling
interest
necessary to
revoke power

Page 164 of 297

Other rights
and obligations
of partners:
1. Right to
associa
te
another
person
with
Each may him in
execute all acts
his
of
share
administration
without
consen
t
of
other
partner
s
(subpar
Concurrence tnershi
of
all necessary p)
for
the validity of
2. Right to
acts
inspect
and
copy
partner
ship
books
at any
1.
reason
able
hour
2.
3. Right to
a
formal
accoun
t as to

partners
hip
affairs
(even
during
existenc
e
of
partners
hip):
1. I
f
h
e

hip
bus
ine
ss
or
pos
ses
sio
n

i
s

o
f
it
s
p
r
o
p
e
r
t
y
Q

ui

w
r
o
n
g
f
u
l
l
y

c
k
Ti
m
e

b
y
a
n
d
a

h
i
s
c
o
p
a
r
t
n
e
r
s

e
x
c
l
u
d
e
d

T
I
F
F
(
U
n
c
o
m
p
r
e
s
s
e
d
)
d
e
c
o
m
p
r
e
s
s
o
r

f
r
o
m
p
a
r
t
n
e
r
s

2. If

rig
ar
ht

enee
d

exi
d
sts
tosee
this

n
d
e
r
p
i
c
t
u
r
e
.

t
h
e
t
e
r
m
s
o
f
a
n
y

3.

4.

a
g
r
e
e
m
e
n
t
A
s
pr
o
vi
d
e
d
b
y
a
rt
1
8
0
7
W
h
e
n
e
v

4.

er
oth
er
circ
um
sta
nce
s
ren
der
it
just
an
d
rea
son
abl
e
Duty to
render
on
deman
d true
and full
informa
tion
affectin
g
partner
ship to
any
partner
or legal
represe
ntative
of any

PROPE
RTYa
partner
has an
equal
right to
possess
ion
which is
not
assigna
ble and
such
right is
limited
to the
share of
what
remains
after
partner
ship
debts
have
been
paid

deceased
partner or
of any
partner
under legal
disability

5. Duty

to
account to
the
partnershi
p
as
fiduciary

2) PROPERTY

RIGHTS OF A
PARTNER
1. His rights
in
specific
partners
hip
property
2. His
interest
in
the
partnershi
p
3. His right
to
particip
ate
in
the
manage
ment
(Art.
1810)
NATURE OF
PARTNE
R'S
RIGHT
IN
SPECIFI
C
PARTNE
RSHIP

NATURE OF
PARTN
ER'S
RIGHT
IN THE
PARTN
ERSHI
Pa
share in
the
profits
and
surplus

3)

OBLIGATI
ON
OF
PARTNER
S
WITH
REGARD
TO THIRD
PERSONS
1. Every
partner

2.

ship
shall
operate
under a
firm
name.
Persons
who
include
their
names
in
the
partners
hip
name
even if
they are
not
member
s shall
be liable
as
a
partner
All
partners
shall be
liable for
contract
ual
obligatio
ns of the
partners
hip with
their
property,
after all
partners
hip
assets
have
been
exhaust
ed:
1. P
ro
ra
ta
2. S
u
b

3.

4.

s
i
d
i
a
r
y
Admissi
on
or
represe
ntation
made
by any
partner
concern
ing
partner
ship
affairs
within
scope
of his
authorit
y
is
evidenc
e
against
the
partner
ship
Notice
to
partner
of any
matter
relating
to
partner
ship
affairs
operate
s
as
notice
to
partner
ship,
except
in case
of

fraud:

1. K

2.

n
o
w
le
d
g
e,
of
p
ar
tn
er
a
ct
in
g
in
th
e
p
ar
ti
c
ul
ar
m
at
te
r,
a
c
q
ui
re
d
w
hi
le
a
p
ar
tn
er
K
n
o
w

l
e
d
g
e
o
f
t
h
e
p
a
r
t
n
e
r
a
c
ti
n
g
i
n
t
h
e
p
a
r
ti
c
u
l
a
r
m
a
t
t
e
r
t
h
e

3.

n
pr
e
s
e
nt
to
hi
s
m
in
d
K
n
o
w
le
d
g
e
of
a
n
y
ot
h
er
p
ar
tn
er
w
h
o
re
a
s
o
n
a
bl
y
c
o
ul
d
a
n
d
s

h
o
u
l
d
h
a
v
e
c
o
m
m
u
n
i
c
a
t
e
d
i
t
t
o
t
h
e
a
c
ti
n
g
p
a
r
t
n
e
r

5. Partners

and the
partners
hip are
solidary
liable to

rd

3
persons
for
the
partner's
tort
or
breach of

trust

6. Liability of
incoming
partner is
limited to:

Page 165 of 297

Civil Law
Summer
Reviewer

r
t
y

ATENEO
CENTRALBAR
OPERATIONS

f
o
r

2007

1. H
i
s
s
h
a
r
e
i
n
t
h
e
p
a
r
t
n
e
r
s
h
i
p
p
r
o
p
e

e
x
i
s
t
i
n
g
o
b
l
i
g
a
t
i
o
n
s

2. H
i
s

s
e
p
a
r
a
t
e
p

r
o
p
e
r
t
y
f
o
r
s
u
b
s
e
q
u
e
n
t
o
b
l
i
g
a
t
i
o
n
s

7. Creditors

of
partners
hip
preferre
d
in
partners
hip
property
& may
attach
partner'
s share
in
partners

8.

hip
assets
Every
partner is
an agent
of
the
partnershi
p

POWER OF
PARTNER AS
AGENT OF
PARTNERSHIP
Acts for carrying on in the
Every partner is an
usual way the business agent
and
may
of the partnership
execute
acts
with
binding effect even if
he has no authority
Except:
when
3rd
person has knowledge
of lack of authority
1. Act
w/c is
not Does
not
bind
apparently for the partnership
unless
carrying of business authorized by other
in the usual way
partners
2. Acts
of
strict
dominion
or
ownership:
3. Assign
partnership
property in trust for
creditors
4. Dispose of good-will
of business
5. Do an act w/c would
make it impossible
to carry on ordinary
business
of
partnership
6. Confess
a
judgement
7. Enter
into
compromise
concerning
a
partnership claim or
liability
8. Submit
partnership
claim or liability
to
QuickTime and a
decompressor
are needed to see this picture.

arbitration TIFF (Uncompressed)

9. Renounce claim of
partnership
Acts in contravention of a
Partnership not liable
rd
to 3 persons having
restriction on authority
actual or presumptive
knowledge
of
the
restrictions

of the ff.:
1. Directly
represent
s himself
EFFECTS OF
to
CONVEYANCE
anyone
OF REAL
as
a
PROPERTY
partner in
BELONGING TO
an
PARTNERSHIP
existing
partnersh
Title in
partnership name, ip or in a
Conveyance in partnership nonname
existing
partnersh
ip
2. Indirectly
represent
s himself
Title in
partnership name, by
Conveyance in
partner's consentin
name
g
to
another
represent
ing him
as
a
partner in
an
Title in name of 1/ more
existing
partners, Conveyance
partnersh
name if partner/partners
ip or in a
whose name title stands
non
existing
partnersh
ip
Title in name of 1/more/all
rd
partners or 3 person in
trust
for
partnership,
Conveyance executed
partnership name if in name
of partners
Title in name of all partners,
Conveyance in name of all
partners
PARTNER
BY
ESTOPPEL
by words
or conduct,
he does any

Page 166 of 297

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007
ELEMENTS TO
ESTABLISH
LIABILITY AS A
PARTNER ON
GROUND OF
ESTOPPEL:
1. Defenda
nt
represe
nted
himself
as
partner/r
epresent
ed
by
others
as such
and not
denied/r
efuted
by
defenda
nt
2. Plaintiff
relied on
such
represent
ation
3. Statemen
t
of
defendant
not
refuted
LIABILITIES IN
ESTOPPEL
All partners
consented to
representation
No
existing

partnership
& all
those
represented
consented;
Not all partners of
existing
partnership
consents
to
representation
No
existing
partnership & not all
represented
consented;
None of partners in
existing
partnership
consented
ASSIGNMENT
OF INTEREST
IN
PARTNERSHIP
Assignment is
subject to three
(3) conditions:
1. made in
good
faith
2. for fair
consider
ation
3. after a
fair and
complet
e
disclos
ure of
all
importa
nt
informa
tion as
to
its
value
RIGHTS OF AN
ASSIGNEE:
1. Get
whatev
er
assigno
rpartner

himself & all those who

made
representation liable
pro-rata/jointly

Person who
represented
himself liable & those who
made/consented
to
representation
separately
liable

2.

3.

4.

would
have
obtained
Avail
usual
remedie
s
in
case of
fraud in
the
manage
ment
Ask for
annulme
nt
of
contract
of
assignm
ent if he
was
induced
to
join
through
any of
the
vices of
consent
Demand
an
accountin
g
(only
in
case
of
dissolutio
n)
TIF

QuickTime
and a

F
(
U
n
c
o
m
p
r
e
s
s
e
d
)
d
e
c
o
m
p
r
e
s
s
o
r
a
r
e
n
e
e
d
e
d

t
o
s
e
e

4) RESPON

SIBILITY
OF
PARTNER
SHIP TO
PARTNER
S
1. To
refund
the
amount
s
disburse
d
by
partner
in behalf
of
the
partners
hip
+
corresp
onding
interest
from the
time the
expense
s
are
made
(loans
and
advance
s made
by
a
partner
to
the
partners
hip
aside
from
capital
contribu
tion)

t
h
i
s
p
i
c
t
u
r
e
.

2. To answer

3.

for
obligations
partner
may have
contracted
in
good
faith in the
interest of
the
partnership
business
To answer
for risks in
consequen
ce of its
manageme
nt

CHAPTER 3:
DISSOLUTION
AND WINDING
UP
DISSOLUTION
change in the
relation of the
partners
caused by any
partner
ceasing to be
associated in
the carrying on
of
the
business;
partnership is
not terminated
but continues
until
the
winding up of
partnership
affairs
is
completed
WINDING UP
process of

settling the
business or
partnership
affairs after
dissolution
TERMINATION
that
point
when
all
partnership
affairs
are
completely
wound up and
finally settled.
It signifies the
end of the
partnership
life.
CAUSES OF
DISSOLUTION:
1. Without
violation of
the
agreement
between
the
partners
1. By
termin
ation
of the
definit
e
term/
partic
ular
under
taking
speci
fied in
the
agree
ment
2. By
the
expre
ss will
of any
partn

3.

er, who
must
act in
good
faith,
when
no
definite
term or
particu
lar
undert
aking
is
specifi
ed
By the
expres
s will
of all
the
partner
s who
have
not
assign
ed
their
interes
t/
charge
d them
for
their
separa
te
debts,
either
before
or after
the
termin
ation
of any
specifi
ed
term or
particu
lar

under
taking

4. By

2. In

3.

the
bona
fide
expul
sion
of any
partn
er
from
the
busin
ess in
accor
dance
with
power
confer
red by
the
agree
ment

contraventi
on of the
agreement
between
the
partners,
where the
circumstan
ces do not
permit
a
dissolution
under any
other
provision
of
this
article, by
the
express
will of any
partner at
any time
By
any
event
which

4.

makes
it
unlawful for
business to
be carried
on/for the
members to
carry it on
for
the
partnership
Loss
of
specific
thing
promised
by partner
before
its
delivery

5. Death
6.

7.

8.

of
any
partner
Insolvency
of
a
partner/par
tnership
Civil
interdiction
of
any
partner
Decree of
court
under art
1831

Page 167 of 297

Civil Law
Summer
Reviewer
ATENEO
CENTRAL
BAR
OPERATIONS

2.

2007

GROUNDS
FOR
DISSOLUTION
BY DECREE
OF
COURT (Art.
1831)
1. Partner
declare
d
insane
in any
judicial
procee
ding or
shown
Partner continues to bind partnership
even after dissolution in ff. cases:
(1) Transactions in connection to winding
up partnership
to be

3.

of
uns
oun
d
min
d
Inc
apa
city
of
part
ner
to
perf
orm
his
part
of
the
part
ner
ship
con
trac
t
Part
ner
guilt
y of
con
duc
t

4.

5.

6.

Upon

prejudi
cial to
busine
ss of
partner
ship
Willful
or
persist
ent
breach
of
partner
ship
agree
ment
or
conduc
t which
makes
it
reason
ably
impract
icable
to
carry
on
partner
ship
with
him
Busine
ss can
only be
carried
on at a
loss
Other
circum
stance
s
which
render
dissolu
tion
equitab
le

app
licat
ion
by
pur
cha
ser
of
part
ner'
s
inte
rest
:
Afte
r
ter
min
atio
n of
spe
cifie
d
ter
m/p
arti
cula
r

unde
rtakin
g

Any
tim
e if
part
ner
ship
at
will
whe
n
inte
rest
was
assi
gne
d/c
har
gin
g
ord
er
issu
ed

EF
FE
CT
S
OF
DIS
SO
LU
TIO
N

1.

AUTHORI
TY
OF
PARTNE
R
TO
BIND
PARTNE
RSHIP

GENERAL
RULE:
Authority of
partners to
bind
partnership
is
terminated
Exception:
1. Wind
up
partner
ship
affairs
2. Comple
te
transac
tions
not
finishe
d
QUALIFICATI
ONS:
1. With
respec
t
to
partne
rs
1. Aut

h
o
r
i
t
y
o
f
p
a
r
t
n
e
r
s
t
o
b
i
n
d
p
a
r
t
n
e
r
s
h
i
p
b
y
n
e
w
c
o
n
t

rac
t is
im
me
dia
tel
y
ter
mi
nat
ed
wh
en
dis
sol
uti
on
is
not
du
e
to
AC
T,
DE
AT
H
or
IN
SO
LV
EN
CY
(A
DI)
of
1p
a
r
t
n
e
r
(
a
r
t
1
8
3

3
)
;

2. I
f
d
u
e
t
o
A
D
I
,
p
a
r
t
n
e
r
s
a
r
e
l
i
a
b
l
e
a
s
i
f
p
a
r
t
n

9.

ers
hip
not
dis
sol
ve
d,
wh
en
the
ff.
co
nc
ur:
If
ca
us
e
is
AC
T
of
pa
rtn
er,
act
ing
pa
rtn
er
mu
st
ha
ve
kn
ow
led
ge
of
s
u
c
h
d
i
s
s
o
l
u
ti

onQu

ickTime
ad a

ii.

TIFF
(Uncompresse
d)
decompressor

I
f
c
a
u
s
e
r

e
n
e
d
e
d

i
s
t

s
e
e

D
E
A
T
H
t

h
i
s
p
i
c
t
u
r
e
.

o
r
I
N
S
O
L
V
E

NC
Y,
acti
ng
par
tne
r
mu
st
hav
e
kn
owl
ed
ge/
not
ice

2. With
respect to
persons
not
partners
(Art.

(2)

1834
)

a
.

(1)

affai
rs/c
om
pleti
ng
tran
sact
ions
unfi
nish
ed
Tra
nsa
ctio
ns
whi
ch
wo
uld
bin
d
part
ner
shi
p if
not
diss
olv
ed,
wh
en
the
oth
er
part
y/o
blig
ee:
Situ
atio
n 1
1. H
a
d
e
x

t
e
n
d
e
d
c
r
e
d
it
t
o
p
a
r
t
n
e
r
s
h
i
p
p
r
i
o
r
t
o
d
i
s
s
o
l
u
ti
o
n
&

2. H
a

(2) Situ

d
n
o
k
n
o
w
l
e
d
g
e
/
n
o
ti
c
e
o
f
d
i
s
s
o
l
u
ti
o
n
,
o
r

atio
n 2
1. D
i
d
n
o
t
e
x
t
e
n
d
c

r
e
d
i
t
t
o
p
a
r
t
n
e
r
s
h
i
p

2.

H
a
d
k
n
o
w
n
p
a
rt
n
e
r
s
h
i
p
p
ri
o
r
t
o
d
is
s
o
l

u
ti
o
n

3. H
a
d
n
o
k
n
o
w
l
e
d
g
e
/
n
o
ti
c
e
o
f
d
i
s
s
o
l
u
ti
o
n
/f
a
c
t
o
f
d
i
s
s
o
l
u

ti
o
n
n
o
t
a
d
v
e
rt
is
e
d
in
a
n
e
w
s
p
a
p
e
r
o
f
g
e
n
e
r
al
ci
r
c
ul
a
ti
o
n
in
t
h
e
pl
a
c
e

w
h
e
r
e
p
a
rt
n
e
r
s
h
i
p
i
s
r
e
g
u
l
a
rl
y
c
a
r
ri
e
d
o
n

2. Partner

cannot
bind the
partners
hip
anymor
e after
dissoluti
on:
(1) Wh
ere
diss
oluti
on
is
due

(2)

(3)

to
unlawf
ulness
to carry
on with
busine
ss
(except
:
winding
up of
partner
ship
affairs)
Where
partner
has
becom
e
insolve
nt
Where
partner
unauth
orized
to wind
up
partner
ship
affairs,
except
by
transac
tion
with
one
who:
(1) Sit
uati
on
1-

1
.
H
a
d
e
x
t

e
n
d
e
d
c
r
e
d
i
t
t
o
p
a
r
t
n
e
r
s
h
i
p
p
r
i
o
r
t
o
d
i
s
s
o
l
u
t
i
o
n

&

H
a
d
n
o
k
n
o
w
l
e
d
g
e
/
n
o
t
i
c
e
o
f
d
i
s
s
o
l
u
t
i
o
n
,
o
r
(2) Sit
uati
on
21. D
i
d
n
o

t
e
x
t
e
n
d
c
r
e
d
i
t
t
o
p
a
r
t
n
e
r
s
h
i
p
p
r
i
o
r
t
o
d
i
s
s
o
l
u
t
i
o
n

2. H

3.

a
d
k
n
o
w
n
p
ar
tn
er
s
hi
p
pr
io
r
to
di
ss
ol
ut
io
n
Ha
d
no
kn
owl
ed
ge/
not
ice
of
dis
sol
uti
on/
fac
t of
dis
sol
uti
on
not
ad
ver
tis
ed

i
n
a
n
e
w
s
p
a
p
e
r
o
f
g
e
n
e
r
a
l
c
i
r
c
u
l
a
t
i
o
n
i
n
t
h
e
p
l
a
c

e
wh
ere
par
tne
rsh
ip
is
reg
ula
rly

c
a
r
r
i
e
d
o
n

Page 168

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

B. DISCHARGE
OF LIABILITY
Dissolution
does not
discharge existing
liability of partner,

except by

agreement
between:
Partner
and himself

person/
partners
hip
continui
ng the
busines
s
partners
hip
creditor
s

RIGHTS OF
are needed to see this picture.

PARTNER
WHERE
DISSOLUTION
NOT IN
CONTRAVENTIO
N OF
AGREEMENT:
1. Apply

2.

of
297

partnershi
p
property
to
discharge
liabilities
of
partnershi
p
Apply
surplus, if
any
to
pay
in
cash the
net
amount
owed to
partners

RIGHTS OF
PARTNER
WHERE
DISSOLUTION IN
CONTRAVENTIO
N OF
AGREEMENT:
1. Partner
who did
not cause
dissolutio
n
wrongfully
:
1. A
p
pl
y

2.

p
a
rt
n
er
s
hi
p
pr
o
p
e
rt
y
to
di
s
c
h
ar
g
e
li
a
bi
lit
ie
s
of
p
a
rt
n
er
s
hi
p
A
p
pl
y
s
ur
pl
u
s,
if
a
n
y

3.

to
p
a
y
in
c
a
s
h
th
e
n
et
a
m
o
u
nt
o
w
e
d
to
p
a
rt
n
er
s
In
d
e
m
ni
ty
fo
r
d
a
m
a
g
e
s
c
a
u
s
e
d

4.

b
y
p
a
rt
n
er
g
ui
lt
y
of
w
ro
n
gf
ul
di
s
s
ol
ut
io
n
C
o
nt
in
u
e
b
u
si
n
e
s
s
in
s
a
m
e
n
a
m
e
d
ur
in
g

5.

2. Partner

a
gr
e
e
d
te
r
m
P
o
s
s
e
s
p
a
rt
n
er
s
hi
p
pr
o
p
e
rt
y
if
b
u
si
n
e
s
s
is
c
o
nt
in
u
e
d

who
wrongly
caused
dissolutio
n:

1. If

b
u
si
n
e
s
s
n
ot
c
o
nt
in
u
e
d
b
y
ot
h
er
s
a
p
pl
y
p
a
rt
n
er
s
hi
p
pr
o
p
e
rt
y
to
di
s
c
h
ar
g
e

li
a
bi
lit
ie
s
of
p
a
rt
n
er
s
hi
p
&
re
c
ei
v
e
in
c
a
s
h
hi
s
s
h
ar
e
of
s
ur
pl
u
s
le
s
s
d
a
m
a
g
e
s
c
a

2.

u
s
e
d
b
y
hi
s
w
ro
n
gf
ul
di
s
s
ol
ut
io
n
If
b
u
si
n
e
s
s
c
o
nt
in
u
e
d
b
y
ot
h
er
s
h
a
v
e
th
e
v
al

u
e
of
hi
s
in
te
re
st
at
ti
m
e
of
di
s
s
ol
ut
io
n
a
s
c
e
rt
ai
n
e
d
a
n
d
p
ai
d
in
c
a
s
h/
s
e
c
ur
e
d
b
y
b

o
n
d
&
b
e
re
le
a
s
e
d
fr
o
m
al
l
e
xi
st
in
g/
fu
tu
re
p
a
rt
n
er
s
hi
p
li
a
bi
lit
ie
s
RIGHTS
OF
INJURED
PARTNER
WHERE
PARTNERSHIP
CONTRACT
IS
RESCINDED ON
GROUND
OF
FRAUD/MISREP
RESENTATION
BY 1 PARTY:

QuickTime

and a

1.

Right to TIFF lien(Ucompressed)onsurplus decompreor of partnership property

after satisfying partnership liabilities

2. Right

to
subrogati
on
in
place of
creditors
after
payment
of
partnershi
p
liabilities
3. Right of
indemnific
ation by
guilty
partner
against all
partnershi
p debts &
liabilities
3. SETTLEMEN
T
OF
ACCOUNTS
BETWEEN
PARTNERS
ASSETS OF THE
PARTNERSHIP:

1. Partnersh

2.

ip
property
(including
goodwill)
Contributi
ons of the
partners

2.
ORDER OF
APPLICATION
OF ASSETS:
1. Partners
hip
creditors
2. Partners
as
creditors
3. Partner
s
as
investor
s
return of
capital
contribut
ion
4. Partner
s
as
investor
s
share of
profits if
any
D.
WHEN
BUSINESS
OF
DISSOLVED
PARTNERSHIP
IS CONTINUED:
1. Creditors
of
old
partnershi
p are also
creditors
of
the
new

3.

partnershi
p which
continues
the
business
of the old
one w/o
liquidatio
n of the
partnershi
p affairs
Creditors
have an
equitable
lien
on
the
considera
tion paid
to
the
retiring
/decease
d partner
by
the
purchaser
when
retiring/de
ceased
partner
sold his
interest
w/o final
settlemen
t
with
creditors
Rights if
retiring/est
ate
of
deceased
partner:
1. To
have
the
value
of his
intere
st
ascer
taine
d as

2.

of the
date
of
dissol
ution
To
receiv
e as
ordin
ary
credit
or the
value
of his
share
in the
dissol
ved
partn
ershi
p with
intere
st or
profit
s
attrib
utabl
e to
use
of his
right,
at his
optio
n

PERSONS
AUTHORIZED
TO WIND UP
1. Partners
designate
d by the
agreemen
t
2. In
absence
of
agreemen
t,
all
partners
who have

3.

not
wrongfully
dissolved
the
partnershi
p
Legal
represent
ative
of
last
surviving
partner
CHAPTER
4:
LIMITED
PARTNER
SHIP

CHARACTERIST
ICS:
1. Formed
by
complian
ce
with
statutory
requireme
nts
2. One or
more
general
partners
control
the
business
3. One or
more
general
partners
contribute
to
the
capital
and share
in
the
profits but
do
not
participat
e in the
managem

4.

ent of the
business
and are
not
personall
y
liable
for
partnershi
p
obligation
s beyond
their
capital
contributi
ons
May ask
for
the
return of

5.

their
capital
contributi
ons under
condition
s
prescribe
d by law
Partnersh
ip debts
are paid
out
of
common
fund and
the
individual
properties
of general
partners

Page 169 of 297

Civil Law
Summer
Reviewer
ATENEO
CENTRALBAR
OPERATIONS

2007

partners
Name may appear in firm
name
Prohibition against
engaging in business
Retirement, death,
insolvency, insanity of
gen partner dissolves
partnership

REQUIREMENT
S FOR
FORMATION OF
LIMITED
PARTNERSHIP:
1. Certifica
te
of
articles
GENERAL
of
the
Personally liable for
limited
partnership obligations
partners
When manner of mgt. not hip
agreed upon, all gen
must
partners have an equal
state
right in the mgt. of the
the
ff.
business
Contribute cash, property
matters:
or industry
1. N
a
Proper party to
m
proceedings by/against
partnership
e
Interest not assignable
of
w/o consent of other
p

DIFFERENCES
BETWEEN
GENERAL AND
LIMITED
PARTNER/PART
NERSHIP

Name must appear in

firm name
No prohibition against
engaging in business
Does not have same
effect; rights
transferred to legal
representative

2.

3.

art
ne
rs
hi
p
+
wo
rd
"lt
d."
Ch
ar
ac
ter
of
bu
sin
es
s
L
o
c
a
ti
o
n
o
f
p
ri
n
c
i
p
a
l
p
l
a
c
e
o
f
b
u
s
i
n
e
s

4. N

a
m
e
/
p
l
a
c
e
o
f
r
e
s
i
d
e
n
c
e
o
f
m
e
m
b
e
r
s

5. Te
r
m
fo
r
p
ar
tn
er
sh
ip
is
to
ex
ist

6. A

7.

8.

m
o
u
n
t
o
f
c
a
s
h
/
v
a
l
u
e
o
f
p
r
o
p
e
rt
y
c
o
n
tr
i
b
u
t
e
d
Ad
diti
on
al
co
ntr
ib
uti
on
s
Ti
m
e

i.

a
gr
e
e
d
u
p
o
n
to
re
tu
rn
co
nt
ri
b
uti
o
n
of
li
mi
te
d
p
ar
tn
er

Sharing
of
profits/ot
her
T
I
F
F
(
U
n
c
o
m
p
r
e
s
s
e
d
)
d
e
c
o
m
p
r
e
s
s
o
r

c
o
m
p
e
n
s
a
t
i

QuickTime
and a

o
n
a
r
e
n
e
d
e
d
t
o
s
e
e
t
h
i
s
p
i
c
t
u
r
e
.

10. R

i
g
h
t
o
f
li
m
it
e
d
p
a
rt
n
e
r
(i
f
g
iv
e
n
)
t
o
s
u
b
s
ti
t
u
t
e
a
n
a
s

s
i
g
n
e
e

11. Ri

g
ht
to
a
d
mi
t
a
d
dit
io
n
al
p
ar
tn
er
s
12. R
i
g
h
t
o
f
li
m
it
e
d
p
a
r
t
n
e
r
s
(
i

f
g
iv
e
n
)
t
o
p
ri
o
ri
t
y
f
o
r
c
o
n
tr
i
b
u
ti
o
n
s
13. R
i
g
h
t
o
f
r
e
m
a
i
n
i
n
g
g
e
n
p
a
rt

n
e
r
s
(
i
f
g
i
v
e
n
)
o
r
c
o
n
t
i
n
u
e
b
u
s
i
n
e
s
s
i
n
c
a
s
e

of
de
at
h,
ins
an
ity,
ret
ire
m
en
t,
civ
il
int
er
dic
tio
n,
ins
olv
en
cy

14. Ri

gh
t
of
lim
ite
d
pa
rtn
er
(if
giv
en
)
to
de
m
an
d/r
ec
eiv
e
pr

2.

o
p
er
ty/
ca
sh
in
re
tu
rn
fo
r
co
nt
ri
b
uti
o
n
Certificat
e must be
filed with
the SEC

WHEN
GENERA
L
PARTNER
NEEDS
CONSENT
/RATIFICA
TION OF
ALL
LIMITED
PARTNER
S:
1. Do
any
act
in
contravent
ion of the
certificate
2. Do
any
act which
would
make
it
impossibl
e to carry
on
the
ordinary

3.

4.

5.

6.

7.

business
of
the
partnershi
p
Confess
judgment
against
partnershi
p
Possess
partnershi
p
property/a
ssign
rights
in
specific
partnershi
p property
other than
for
partnershi
p
purposes
Admit
person as
general
partner
Admit
person as
limited
partner unless
authorized
in
certificate
Continue
business
with
partnershi
p property
on death,
retirement,
civil
interdiction
, insanity
or
insolvency
of
gen
partner
unless

authorized
in
certificate
SPECIFIC
RIGHTS OF
LIMITED
PARTNERS:
1. Right to
have
partnershi
p books
kept
at
principal
place of
business
2. Right to
inspect/co
py books
at
reasonabl
e hour
3. Right to
have on
demand
true and
full info of
all things
affecting
partnershi
p
4. Right to
have
formal
account of
partnershi
p affairs
whenever
circumsta
nces
render it
just and
reasonabl
e
5. Right to
ask
for
dissolutio
n
and
winding
up
by

6.

7.

decree of
court
Right
to
receive
share
of
profits/oth
er
compensat
ion by way
of income
Right
to
receive
return of
contributio
ns
provided
the
partnershi
p assets
are
in
excess of
all
its
liabilities

REQUISITES FOR
RETURN OF
CONTRIBUTION
OF LIMITED
PARTNER:
1. All
liabilities of

2.

3.

partnershi
p
have
been
paid/if not
yet paid,
at
least
sufficient
to cover
them
Consent
of
all
members
has been
obtained
Certificate
is
cancelled/
amended
as to set
forth
withdrawal
/reduction
of
contributio
n
LIABILITIE
S OF A
LIMITED
PARTNER

To the
partnership
Page 170 of 297

Civil Law Summer Reviewer

ATENEOCENTRALBAROPERATIONS2007
1. for the difference between his contribution as
2.

actually made and that stated in the

certificate as having been made, and
for any unpaid contribution which he agreed in
the certificate to make in the future time

As a trustee for the partnership

1. for the specific property stated in the
certificate as contributed by him but which he
had not contributed;
2. for the specific property of the partnership
which had been wrongfully returned to him;
and
3. Money or other property wrongfully paid or
conveyed to him on account of his
contribution.
DISSOLUTION OF LIMITED PARTNERSHIP
(Priority in Distribution of Assets):
1. Those due to creditors, including limited
partners
2. Those due to limited partners in respect of
their share in profits/compensation
3. Those due to limited partners of return of
capital contributed
4. Those due to general partner other than
capital & profits
5. Those due to general partner in respect to
profits
6. Those due to general partner for return of
capital contributed

QuickTime and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

Page 171 of
297